NEW DELHI: The three Employee-Linked Incentive (ELI) schemes, announced during the Budget for 2024-25, are going to aid job creation siginificantly, improve “employability” of job-seekers, and bring more people under the social-security net, labour secretary Sumita Dawra said.
In an interview with FE, Dawra said that these schemes– a) targeting first time employees; b) creating jobs in manufacturing; c) providing support to employers – would also greatly help in addressing the “employment paradox”, which is when companies are unable to hire the right people, at a time when there are many individuals who are seeking jobs.
In all, five schemes unveiled in the Budget aim to provide employment and skilling opportunities to 41 million youth over a five-year period, and entail an outlay of around Rs 2 trillion.
On framing rules under the schemes, she said that the government will do inter-ministerial consultations first, and only then come out with rules for operationalisation of the schemes. “We aim to roll-out of the scheme before this calendar year (December),” Dawra said.
“The ELIs were asked for by the industry only…they were consulted before. However, the government may consult them again, if needed,” she added.
“India is looking at being part of the global supply chains, increased formalisation would (increase India’s standing),” said Dawra. “When one person works in an organised sector, it becomes easy for him/her to find a job (internationally),” she added.
She mentioned that the other two schemes– d) upgrading Industrial Training Institutes, and e) offering internship to 10 million youth in top 500 companies–will also help in enhancing employability.
It should be understood that when the first-timers change jobs, they get better salaries, which subsequently improve consumption, the secretary noted. “It’s a win-win situation for the companies as well as the employees…the companies, in fact, are investing in their own future, they will get better/more skilled labour,” said Dawra.
Three of these five schemes (a, b, and c) will be implemented through the Employee Provident Fund Organisation (EPFO). The ‘Scheme A’ targets first-time employees in the formal sector registered with EPFO. It offers a one-month wage (up to Rs. 15,000) in three instalments, paid to employees through direct-benefit-transfer (DBT).
‘Scheme B’ focuses on job creation in manufacturing, where it incentivizes both employees and employers for the additional employment of first-time employees, offering benefits based on their EPFO contributions during the first four years of employment. And ‘Scheme C’ provides support to employers by reimbursing Rs. 3,000 per month for two years towards their EPFO contribution for each additional employee with a salary of up to Rs. 1 lakh per month.
Dawra said that the labour ministry is working with EPFO, so that they are able to roll-out the schemes by December. “They have several mechanisms in place…and are upgrading their systems,” she noted.
‘Scheme D’ is a new centrally sponsored scheme, announced for skilling 2 million youth over five years in collaboration with state governments and industry, along with upgrading 1,000 Industrial Training Institutes (ITIs) to align with industry skill needs.
‘Scheme E’ aims to offer internship opportunities to 10 million youth in 500 top companies over the next five years, with an internship allowance of Rs. 5,000 per month and a one-time assistance of Rs. 6,000, providing exposure to real-life business and professional environments.
The Budget also announced the “comprehensive integration” of e-shram portal with other platforms, facilitating a one-stop solution for skill requirements, job roles, and connecting job aspirants with potential employers and skill providers.
Source: The Financial Express
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